Originally Posted by
CBreezy
There are some people appalled by the lack of growth in the plan. They'd rather be taxed on that money at a higher rate and hope their investments otherwise are enough to overcome the tax hit
No one should be negatively surprised by the MBCBP growth rate, in fact I think this year it was 12%, which is significantly higher than any forecast for the underlying assets.
Originally Posted by
runinonfumes
32%?! That’s a lot of return in one year.
while for this year, yes. That money will be taxed as income one way or another. If I take that money as cash today and invest it I pay income taxes now (let’s say 32%) but only LTCG tax on the growth when I sell (18.8%). if that money goes to the MBCBP that will still be taxed upon withdrawal, and it’s not too unreasonable to think some of us may be in a similar/ higher tax bracket in retirement.
The younger you are the more the rate of return matters. The closer you are to retirement the more the tax advantage matters.